The importance of the client experience for Wealth Management

I found this to be a useful report by Scorpio Partnership on the trends of Wealth management. Below is my pick of the most important trend.

Google the phrase “client centric wealth management” (no hyphen) and you’ll be rewarded with hundreds of thousands of results. After all, the client is always at the center of the relationship between financial advisers and their investment portfolio, and wealth management firms focus on clients’ needs. Right?

Apparently not.

In a recent report, Scorpio Partnership struck at the heart of what it says is lacking in the wealth management industry: the client experience, or as one executive put it, placing “the customer at the heart” of the service experience.
“Wealth management should absolutely be built around client needs,” the report said. “Given the intimacy of the client/advisor relationship it may be hard to believe that it isn’t already, but the truth is that while many firms invest in listening to their clients, few put what they learn to work delighting customers day-in-day-out.”
As 2018 gets underway, we asked April Rudin, founder and president of The Rudin Group, about this disconnect between clients and firms; the “new” client experience; and why she believes 2018 will be the “Year of the Client.”
Below is a lightly edited transcript of the conversation.

CFA Institute:

I’m a little surprised that it’s 2018 and we find ourselves still talking about the importance of the client experience. What have you observed over the past year that makes you think this is an area that needs attention?

April Rudin:

Over the past year, I have noticed that while many wealth managers, and other financial services executives, are high-end consumers who value the client experience offered by luxury brands, for example, they struggle with translating that same experience to their own client offerings. For many firms and advisers, it means doing a 180 to see things from the clients’ perspective and how they value services, offerings, and even client communication. Something else I have seen is that some people who are using their smartphones and a variety of apps in their personal lives are reluctant or slow to adopt technology in their professional lives.

With $32 trillion (estimated) in the wealth transfer clearly underway, women and the next generation are reshaping the client experience. They value being treated and understood as individuals, yet much of wealth management remains in the “one-size-fits-all” mentality. Reconciling what clients want with what firms are offering will be the single most important area for the wealth management industry to focus on in 2018 and beyond.

The good news is that firms that get this right stand to have the greatest advantage in 2018 and beyond to grow assets under management (AUM) and gather new assets. And by the way, it’s iterative; not “one and done” — there is no single action or magic bullet. It must be an ongoing effort.

It is key for firms and advisers to keep their online/digital best foot forward. And on all channels. Today’s global investors are online and connected. They want their advisers to be as well.

Has Elon Musk's launch impacted the energy of entrepreneurs?

Money and scaling up your business is a key part of early day businesses. Self funding is one of the options, and then crafting the business and product until it is proven. Getting validation is a common characteristic of most of my best investments.

Holy Moly, Elon Musk achieved epic market validation for Space X by showing his Falcon Heavy launch to the world. 

Not only that, Elon has just executed what will become the text book case for branding with the video of the launch posted on Instagram. As I watched these videaos, the incredible achievements of reusable rockets returning to the launch pad, the cars lined up to watch just like the landing on the moon days, the thrill of seeing that iconic shot of the world with the astronaut sitting in a red Tesla, hood down, cruising through space on its way to Mars, my eyes filled with tears.

Suddenly,  Musk's crazy Tesla in space made on Earth by humans became obvious. This crazy, eclectic big dreamer, Elon Musk, just achieved his crazy goal. For attracting investors, crypto currencies seem dull by comparison.

The rocket launch highlight videos were created by Westworld co-creator Jonah Nolan. "The only way I know how to share [the Falcon Heavy launch] is a trailer," Nolan said. "It’s not for TV or a movie, it’s for the next part of the human story."

Elon Musk says your business should be about, "things that inspire you, that make you glad to wake up in the morning and be part of humanity."

This week, I am going to a startup lunch with top Toronto investors. I will be bringing that Elon Musk inspiration to fuel up my impact.

Game changer leadership of President Cyril Ramaphosa

Foreword by Cyril Ramaphosa

Since Cyril Ramaphosa became president of South Africa, many people know he wrote the foreword to one of my technology books and ask me about his character. What is he like?  If I were to sum up Cyril Ramaphosa, it would be to say he is all about disruptive leadership.

Cyril has an incredible mindset which is full of appreciation. He has emotional sense, people sense, but also an economic mindset. Gold appreciates, bitcoin appreciates, Cyril appreciates. What appreciation really means is that you give value. That is Cyril. He is not worrying about how he is going to get paid back. He is constantly giving greater value with generosity.

I was very fortunate enough to know Cyril when he wrote the foreword to my book on technology's impact on businesses and society in South Africa. He wrote about the changing potential for wealth in South Africa to reach more of the people.

Cyril's reflected on his own track record which was the accelerated African dream where he went from a poor Venda boy to President of South Africa. On that journey, Cyril had the courage to set up and run South Africa's first black union. It is easy to forget the brutal power of the government at that time and organizing any group could have resulted in death. Yet Cyril's inclusive leadership style helped the black union grow in power, He gained the respect of the union members and the management teams, becoming an essential part of the mining world. Cyril ran these union organizations for many years.

After being passed over by Mandela for the leadership of the ANC, Cyril went on to become the leading business man of South Africa, married into the wealthiest African family.

I was looking at Cyril's declared investments which give his stock ownership of South Africa's blue chip companies and also his private investments. It is great to see Cyril does private equity investments into exciting businesses such as Fever Tree consulting and McDonalds. This is a business man who understands all sides of the negotiation table. This is what will be the game changer for South African politics.

How did Cyril managed this meteoric rise in his level of success?

Cyril is a giver.

He has the mindset and behaviour of a man committed to win/win. As the head of the first black union, his ability to engage all people with his humour and warmth did its magic.  Mine owners and managers started to realize that their black workers were thinking people who could be brought on board for productivity boosts and better work practices to benefit all. Their opinions could be asked and they would no longer be silent. This is a happier work world. Win/win.
  

Women in South Africa were just beginning to rise up in the business world. At that time, I already had been the strategist for Investec Bank and my first book, The Power of Strategy, was a best seller and award winner. I remember Cyril was delighted to help me with my book. His foreword is full of the promise of the wealth of South Africa.  He gave me, a female, such support which in turn made me dedicated to my time in South Africa and to contribute to its economy and more.

Cyril was always making a bet on the future without concern about the returns. He is super succesful but also super generous. He now has become the leader of South Africa and he will bring that abundance of opportunities to the economy but also the society. The speed of change is accelerating. Cyril is the leader South Africa needs. He is the change South Africa needs and deserves. I am grateful to Cyril for believing in me and for all of his support.

Happy Valentine's Day

First step for business owners preparing for sale is to get a valuation

Perhaps that is why the recent research by Investor Watch reveals that nearly 60% of wealthy investors would consider starting their own business.

At the same time, the favorable economic environment is spurring some business owners to cash out. And it remains to be seen who will fill the void.

• 41% of business owners plan to exit their business.
• 80% will sell or close the business—or they’re not sure what to do. 
• Another 20% intend to give the business to family.

Business owners who plan to sell are far too often unprepared for the process. Less than half have had their business appraised, for example. I am always shocked by how many business owners think they only need an accountant and a lawyer to sell their business, The first step of getting a valuation by a professional advisor would quickly show them the value of their business.  Equipped with a reality check on their assumed price for their business, they can then see if their cash flow of their business will be a better long term wealth strategy or time to sell and invest the payout. Having an investment banker on the team to do the sale of their business becomes obvious after the sale of the business.

At the same time that business owners are thinking of exiting, 58% of wealthy investors would consider starting a business. Together, these trends are increasing the need for advice and creating growth opportunities for Financial Advisors.

Please give me a call if you are thinking about how to maximize the wealth of your business.  

We have much to offer business owner clients and prospects. From lending, insurance and retirement plans to pre-sale planning, Employee Stock Ownership Plans and more, All good conversations to have when it comes to building your long term wealth.

 

 

Join me on Twitter @jacolineloewen

 

Check out my book for business owners wanting to sell to private equity.

Money Magnet: How to Attract Investors to Your Business

Planning is a bore compared with running a business but 3 simple questions can help a lot

Business owners make their wealth through concentrated efforts. The key to successful transitions involves focusing that same energy on planning the next stage of life and putting their wealth to work through investments outside their own companies.

Planning is a bore compared with running a business. If owners want to fully benefit from their lives' work, they need to grit their teeth and start tackling those three life questions before they get answered for them by life's forces.

The problem is, most owners avoid thinking about their next stage, their businesses don't get sold properly, and they lose the wealth they spent their lives building.

"One business owner that we came across had no transition plan, no successor, a son in the business who did not have an interest in running it, and no estate plan at all," says Maria Milanetti, a partner at MarchFifteen, a consulting practice specializing in business transitions.

"The owner was 70 years old, running a highly successful business, and utterly oblivious to the risks for his family's future wealth."

This scenario is common in Canada.

Too often, the only part of a business that can be salvaged are its assets, but not a great deal more, leaving the family in a precarious position. The economy also loses a company that could have continued under new leadership.

Why is this sad lack of transition such a common scenario for too many privately owned businesses?

Milanetti says, "It's quite natural for founders and those running the business successfully to 'want to keep a good thing going' and to feel that they need to keep running the business themselves." 

 "Often they want to 'protect' others from this responsibility."

 But their reluctance to share how they make decisions or influence stakeholders with their next generation leaders can have long-term negative effects. Milanetti acknowledges it can be difficult to start the conversation around transition or succession. She recommends starting with the following three questions:

Have you thought about the next chapter in your business?
This question may prod an owner to be able to describe verbally a picture of the business within the next five years. As an extension of this question, it can be useful to include the next generation of leaders if there are any tapped to take over the business. Ask them to share how they want to build the business in the longer term. Like the son working with the 70 year old owner encountered by Maria, the truth will come out that they have no interest. Many next generation family members are not wanting to take over the business and doing this type of exercise will bring this urgent issue into the light sooner than later.

How can we plan that future together?
Suggest setting aside some time with a facilitator or business adviser and describe how critical conversations can be shared in a relaxed, reflective and safe situation. It makes it a safer process. It also means someone else brings energy and an outsider perspective to winkle out those tough questions business like to avoid but that need to be addressed.

What will your life look like in three years?
It can not be underestimated how difficult it can be to step away from a business, even if the Chairman role is still offered with a desk at the office. The emotional challenges of giving up control over a privately owned business and transitioning into a new role as “ex-entrepreneur” – whatever this new role may be – requires reflection about one’s identity and about other family members. This is not a natural state for most high-action owners. Dealing with this identity change can be very important to helping the transition to take place. However, this can be the most tricky question to bring up as it starts to deal with the prickly topic of the business transition. Peter Pan whispers that planning for life after the business means retirement, and that's for old people, not a dynamic business owner, no matter the biological age. That way of thinking can be disastrous for a family if the owner is forced to reduce his or her time at the business or stop altogether. It is better to address changes while everyone is healthy and has the time and energy.

 

"At every juncture," Milanetti says, "We recommend planning. That is planning for the mentoring of next generation leaders, for the transition between current leadership and successors and, most importantly, planning for the owner to be clear what will make their lives meaningful in their next chapter. These are not people who are used to doing nothing. they need to see the door opening to welcoming place."

 

Jacoline Loewen is director of business development of UBS Bank (Canada). 

She is also author of Money Magnet: How to Attract Investors to Your Business. 

You can follow her on Twitter @jacolineloewen.

  

The article above first appeared in the Globe and Mail online.

Learn from the Best

If I had asked people what they wanted, they would have said faster horses. - Henry Ford

10 Questions Anthony Lacavera wants us to ask

Seeing Anthony Lacavera in his casual suit and hip haircut at my formal Bay Street Investment Club made me curious. Yes, Anthony has his book to promote, but what would be his message for the room of mostly public market investors?

I was not disappointed. Anthony challenged the room of influential investors about our shared responsibility for the future of Canada. Anthony quickly picked apart the realities of our laws and our attitudes that if changed, could mean a radically different future for Canada. All of these points are expanded upon in his very good book, How We Can Win.

I have entrepreneurs as my client base, and Anthony’s book is giving me a treasure trove of discussion points for my client meetings in 2018. There are stories about Canadians such as heroes I have been fortunate enough to know such as Claudia Hepburn who helped found The Next 36, Michael Serbenis who created the Kobo, Andy Burgess of Somerset Entertainment, Michael Hyatt of Bluecat and Craig Campbell who built a security company. 

There are also discussions about the Canadian-centric issues I have heard too many times and, quite honestly, I have stopped discussing because they do not seem to change. It was refreshing to hear Anthony's passion.

These were my pick of Anthony’s many questions directed to my Bay Street Finance Club. These ten points particularly sparked me and made me grit my teeth. This year, I hope to use these to bring my best to Canada:

1. Why do we think it normal to go for gold when it’s hockey but we are satisfied with being fourth or tenth in business ratings? The Americans go for survival of the fittest but Canadians think it is mean to crush competitors like cockroaches. Anthony says, "We need to start clawing our way up the value chain."
2.  Why do our government leaders go to the Google offices to get their photo ops? Surely, politicians should prioritize their support of Canadian companies such as Hootsuite? Stop by the Hootsuite HQ in Vancouver, politicians, and you will be surprised by the results. 
3. Can we stop being afraid of picking winning companies and rewarding them? This requires we get past the “everyone’s a winner” attitude and to pick one leader and focus the financial rewards.This means putting government funding in large placements into fewer businesses. We need to be comfortable that competition is positive.
4. Why is not one Canadian VC or private equity firm invested into one of the leading Waterloo area companies, Thalmic Labs? Why does it take Americans to do the investing? Thalmic Labs comes out of the Next 36 program and are a great Canadian venture. 
5. Why should we care where investment money originates? Globealive had the government tell him his investors had to get out of his company because they were from a different part of the world. The Middle East is not banned from my bank as potential clients and Anthony's investors certainly cleared the barriers. 
6. Why do we have such difficult inter provincial trade barriers and what does it cost business?
7. Why do most Canadian companies not think of being an export business? They are satisfied with being big enough. 
8. What is Canada known for? Why do we have investors into cannabis but not into Ai, Machine learning? Uber, co-founded by a Canadian, is in MaRS and has a Canadian Ai expert leading it. Surely our VC investments should be going into these tech endeavours but we seeem to like the drug industry more.
9. Why are Canadian entrepreneur leaders not known and celebrated?  We all know Bill Gates or Elon Musk (ironically a Canadian) of America but how about Ryan Holmes of Hootsuite?
10. What can we do to reduce the brain drain of our tech students to America? We are losing our youth to the USA. My son is graduating from Waterloo and is off to Seattle to work for Microsoft so that point really hurts! Ouch.

Waterloo students create WatVision to help visually impaired to read touch screen

The Waterloo student teams create products in their fourth year and I was impressed with my son and his group - WatVision. 

Their product is to help visually impaired people read a touch screen. The idea developed as a visually impaired person talked about how the new coffee maker at work had a touch screen which he could not use, unlike the old coffee machine.  

This product has been created to help a visually impaired person use a touch screen. Check out the video.

https://www.youtube.com/watch?v=HI3hGIS06DM&feature=youtu.be

The video shows Craig demoing how to use our system. Here is a breakdown of how he did it.

1. Start the app and point your phone camera at the touch screen you are trying to use
2. Listen to the app, it will guide you to aim the camera at the entire screen. It will give commands such as “Move Left” or “Move Up” to help the user capture the whole screen.
3. Place the finger wearing the ring on the touch screen and begin exploring!

That’s all it takes, let the app do the reading for you. When your finger moves over text or buttons, the app reads out what its for so you as the user can decide whether you want to use it or not.

Interesting in trying it?

We are looking for participants to try out the system and give us feedback as we continue to develop. If you or someone you know has a visual impairment and would be interested in trying out the Watvision system, contact us at watvisionteam@gmail.com.

Annual Investment Luncheon at The Empire Club

2018 Investment Outlook Luncheon

I was honoured to be invited to join the head table at the Annual Investment Outlook Luncheon held at the Empire Club. We were joined by the CFL players who impressed me with their knowledge of blockchain and crypto-currencies.

@Empire_Club 2018 Investment Outlook Luncheon #gold #investment #outlook2018